Tax cuts to help crunch victims

The Liberal Democrats are proposing income tax cuts of 4p in the pound off the basic rate — as the credit crunch bites.

The party says the crunch is hitting Oldham’s homeowners hard with annual mortgage repayments increasing by £349 in the last month alone.

Banks and building societies have recently announced a number of increases in mortgage rates, including a 0.45 per cent rise from Halifax and 0.3 per cent from HSBC.

Now the Lib-Dems want tax cuts to put money back into people’s pockets to help them cope with rising bills.

Elwyn Watkins, Liberal Democrat parliamentary spokesman for Oldham East and Saddleworth, said: “The home loans increase will cause real hardship for many people.

“There is clearly a lack of competition for mortgage rates, and many local households will get a nasty surprise when they come to the end of their fixed-rate period.”

“The 4p tax cut would leave 90 per cent of people with more money in their pocket.”

The average cost of a house in Oldham is now £122,572 according to Housing Intelligence business hometrack.